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The Disrupters: Institutional Investor's Tech 50

Though not neglecting their day-to-day concerns of maximizing efficiency and minimizing costs, the executives who rise to distinction in the Institutional Investor Tech 50 have longer-range ambitions: to gain a competitive edge by catching the next wave of disruptive innovation.

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Some of the best things on the web are free, muses
Lance Uggla, CEO of Markit Group. When I look at how
financial markets will use technology to transform their
networks of participants, I think the word free has
to be included.

He is referring to the way Facebook and Google are free 
and to the new commercial models they have spawned. The
financial services industry is poised for its own Google-like
revolution, says Uggla, who in ten years has built Markit into
a global force in market information and transaction-processing
services. No. 5 in this years Tech 50, Institutional
Investors annual ranking of financial technology leaders
and innovators, Uggla says he spends 10 to 15 percent of his
time thinking and talking with others about a free
strategy and how disruptive it would be to todays
business model.

Disruptive is the operative word, and it is a
thread running through the Tech 50. The idea harks back to The
Innovators Dilemma, a 1997 book by Harvard Business
School professor Clayton Christensen that explained how
long-entrenched, industry-leading companies can fail to
anticipate disruptive technologies or seize the
opportunities they present.

Todays financial services disrupters do not so much fear
falling into obsolescence like Christensens 20th-century
case studies  such as Digital Equipment Corp., which was
blindsided by the personal computer  as they are eager to
make innovative leaps to gain competitive advantages. Taking
the productivity and efficiency afforded by automation as a
given, executives see technology in a more opportunistic light:
as a tool for growth.

Disruption defines why Reto Francioni and Duncan Niederauer,
the respective CEOs of Deutsche Börse and NYSE
Euronext, jointly rank No. 1 on the Tech 50. Their agreement in
February to merge and create the worlds biggest exchange
organization was itself a disruptive, even provocative,
strategic stroke. Now they face the further test of making
their deal pay off in ways that few large-scale mergers do.

It falls to an executive team of seasoned technologists 
including, besides Francioni and Niederauer, Deutsche
Börse derivatives chief Andreas Preuss and NYSE president
(and IBM Corp. veteran) Dominique Cerutti  not only to
accomplish the essential systems integrations but also to
develop and deploy disruptive, business-transforming,
revenue-­enhancing technology services as their company
becomes bigger and more complex.

If NYSEs June announcement of the Capital Markets
Community Platform  a cloud computing utility touted as a
financial services industry first  is any indication,
then they may very well be able to keep that focus as the
merger moves forward.

Two other CEOs in the top ten, Jeffrey Sprecher of
Intercontinental­Exchange and Robert Greifeld of Nasdaq OMX
Group, were disruptive in another sense when they joined forces
in March to try to derail Deutsche Börses deal with
NYSE Euronext by making a hostile bid for the latter. Sprecher
and Greifeld eventually had to withdraw for antitrust reasons,
but technology was central to the case they tried to make. They
asserted that their own postmerger track records for efficiency
and innovation were superior to those of Börse and NYSE.
Indeed, Sprecher could be speaking for any number of the Tech
50 in stressing ICEs culture of enabling
change and unwavering dedication to product
innovation, technological advancement, customer service and
transparent markets.

The influence of Facebook and Google is evident not only at
Markit, which in May introduced an investment research app for
the Apple iPad in partnership with Deutsche Bank, but also in
mobile and social network applications for mass consumption
championed by other Tech 50 honorees (Bank of America
Corp.s Catherine Bessant, No. 14; Cortal Consors
Olivier Le Grand,
No. 13; and StockTwits Howard Lindzon, No. 46).

Avid Modjtabai (No. 10), Wells Fargo & Co.s head of
technology and operations, views innovation as an extension of
everyday problem solving. The motivation is never
technology for technologys sake, she says
 a conviction also voiced by Stephen Scullen
(No. 6), Fidelity Investments president of corporate
operations. We pride ourselves on being a firm that is
innovative and disruptive to the way things are done in the
financial services world, says Scullen, but always with
the aim of making things easier for customers,
improving their experience.

The Tech 50 ranking, identifying leading executives, system
developers, entrepreneurs and others at the forefront of change
and innovation in financial technology, is compiled by the
editors and staff of Institutional Investor, with nominations
and other input from industry experts. Four primary sets of
attributes were evaluated: experience and contributions over
the course of a career; scope and complexity of
responsibilities; influence and leadership inside and outside
ones organization; and pure technological innovation or
achievement. Of the 50 entries, 24 return from last years
Tech 40; the rest are designated PNR (previously
not ranked).